Comments from Atlanta Fed Lockhart are often directly in synch with the core of the Fed and tend to reflect the consensus.

  • Sees lift off in mid-2015 or later
  • Soft wage pressures show considerable labor slack
  • Weakness in Europe and Japan are risks to the outlook
  • Lower oil prices may hit business investment in near-term but are benefit in long term
  • Expects rate increases to be a gradual process
  • Tightening cycle not likely to include hikes at every meeting

Lockhart is a voter in 2015 and the type of caution he’s preaching is more dovish than what’s in the market and is a downside risk to USD.

Update: Lockhart adds that he’s not in a rush to drop ‘considerable time’ phrase from the statement. If that’s the case at the Fed meeting on Dec 16, the US dollar will sell off.